You can sell the one and keep the other, for say rental purposes.
With the one you will sell, keep the following in mind:
a) You will have to pay income tax on any profit you make at normal rates (i.e. not treated as a capital gain at potentially concessional rates).
b) With the one you sell, most likely you will have to register for GST and remit GST on the sale proceeds received (although you might be able to use the GST Margin Scheme to calculate the relevant GST). Also, you will have to split all expenses between the 2 properties in order to claim GST on those inputs relating to the one you want to sell but not claiming any GST on that property you wish to retain for rental.
c) With the one you will be keeping and potentially renting, keep in mind that if you rent it but then sell it within 5 years, you may be up for GST on this one as well (as it is deemed to be the sale of new residenital premises.)
All tens to get a bit involved so best to discuss with an accountant.
Zargor
DISCLAIMER
Get proper accounting and legal advice and never rely on what I say.